Initial Jobless Claims, More Powell: Daily Contrarian, June 23
Good morning CommonStock! Stocks and cryptos are pointing to a rebound in the pre-market, but copper and bond prices might be more telling…
Initial jobless claims are out at 0830. Economists expect 227,000 new claims, down a bit from the 229,000 seen last week. This is an important metric to watch as many are saying that employment needs to slow before there can be any progress on inflation. Inflation of course being the one thing that is going to keep the Fed’s foot on the gas pedal of rate hikes.
Jay Powell returns to Capitol Hill for his second day of testimony, this time in front of Congress. Not expecting much to come from this as he is just likely to repeat his comments from yesterday.
In practical terms, employment is still too strong for the economy to slow by any reasonable magnitude. But that can’t persist with the Fed raising rates to slow down economic activity. That, at least, is the simple calculation. There’s a lot of room for nuance and many ways we can presumably still avoid economic contraction. But none of that is going to be resolved this week.
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